Appeals court clears the way for California to set its own zero emission standards

A federal appellate court on Tuesday upheld the decision by the Environmental Protection Agency (EPA) to grant California a waiver allowing it to establish its own zero emission standards for tailpipes as well as electric vehicle requirements.

A three-judge panel of the U.S. Circuit Court of Appeals for the District of Columbia rejected a legal challenge to California’s standards that was brought by a group of 17 Republican-led states and entities that sell or produce liquid fuels.

In 2022, the Biden administration’s EPA restored California’s ability to establish its own zero-emission vehicle sales mandate and tailpipe emissions limits through 2025 — a move that reversed a 2019 decision by the Trump administration. 

Republicans opposed to the rule argued that the waiver for California gave it an unconstitutional regulatory power that was denied to other states. The court held that the EPA is required by the Clean Air Act to uphold California’s emissions standards as long as they’re at least as stringent as federal rules.

“In other words, the federal regulations continue to act as the floor for emissions regulations, but California can seek to enact its own more stringent regulatory program above those federal requirements,” the three judge panel wrote in their unanimous opinion.

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The court said the reversal of the EPA decision would address the states’ claims if automakers responded by selling fewer EVs or lowering prices of gas-powered models and wrote that there was no evidence to support that conclusion.

California Gov. Gavin Newsom, a Democrat, said the “court sided with common sense and public health against the fossil fuel industry and Republican-led states. This ruling reaffirms California’s longstanding right to address pollution from cars and trucks.”

The Ohio attorney general’s office, which argued on behalf of the Republican-led states, did not immediately respond to a request for comment on the ruling.

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California received a waiver from the EPA in 1993 for its first zero-emission vehicle standard. The EPA granted another Clean Air Act waiver for California in 2013 that was reinstated in 2022, when it also rejected a Trump-era decision to prohibit other states from adopting California’s tailpipe emissions standards.

The California Air Resources Board (CARB) in August 2022 approved a plan to end the sale of gas-only vehicles in the state by 2035 and established yearly requirements for zero-emission vehicles beginning in 2026 that would escalate until the 2035 goal is met.

In May 2023, CARB asked the EPA for a new Clean Air Act waiver for new EV rules that would start in 2026. The Alliance for Automotive Innovation, which represents most major automakers, raised questions about EV’s requirements in February.

Last month, the EPA finalized the Biden administration’s new tailpipe emissions limits that would be in effect through 2032 and are weaker than its initial proposal from early 2023. The new rules require automakers to sell at least 50% plug-in and electric vehicles by 2030 to meet regulatory targets – down from 60% EVs by 2030 and 68% by 2032 under the initial proposal.

Reuters contributed to this report.